1
Sample MCQ Questions for T.Y.B.COM (SEM-VI)
1. What option does the central government does not include in development expenditure?
A) Grant to States
B) Expenditure on Social and Community Services
C) Expenditure on Economic Services
D) Defence Expenditure
Answer: D
2. Depreciation is defined as
A) destruction of a plant in a fire accident
B) loss of equipment over time due to wear and tear
C) closure of a plant due to labour trouble
D) closure of a plant due to lockout
Answer: B
3. In general, deficit financing can create inflation, but it can be checked if.
A) Government expenditure increases the aggregate supply in the aggregate demand ratio
B) All the investment is indicated as payment on national debt only
C) Only aggregate demand is increased
D) All of the above
Answer: D
4. On July 12, 1982, The ARDC collaborated with
A) NABARD
B) EXIM Bank
C) RBI
D) None of the above
Answer: A
5. What is the main cause of exports surplus?
A) Country’s stringent import policy
B) Developments in national and international markets
C) Country’s exports promotion value
D) None of the above
Answer: B
6. If RBI reduces the cash reserve ratio, the credit creation will
2
A) No impact
B) Decrease
C) Increase
D) None of the above
Answer: C
7. Which option is not mentioned in a firm’s balance sheet?
A) Cash held at the bank
B) Revenue from sales of the company’s products
C) Total issued capital
D) Value of stocks of raw materials held
Answer: B
8. The state financial corporation in the State bank of India gives assistance especially to
A) Medium and Small-scale Industries
B) Large-scale Industries
C) Cottage Industry
D) Agricultural Farms
Answer: A
9. The central co-operative banks are directly associated with
A) Central Government
B) Land Development Banks
C) State Co-operative Banks
D) Farmers
Answer: C
10. The first complete Indian Bank was established in the year.
A) 1794
B) 1894
C) 1896
D) 1902
Answer: B
11. Accounting furnishes data on
A) Income and cost for the managers
B) Financial conditions of the institutions
3
C) Company’s tax liability for a particular year
D) All the above
Answer: D
12. Long term assets having no physical existence but, possessing a value are called
A) Intangible assets
B) Fixed assets
C) Current assets
D) Investments
Answer: A
13. The assets that can be easily converted into cash within a short period, i.e., 1 year or less are
known as
A) Current assets
B) Fixed assets
C) Intangible assets
D) Investments
Answer: A
14. Copyrights, Patents and Trademarks are,
A) Current assets
B) Fixed assets
C) Intangible assets
D) Investments
Answer: C
15. The debts which are to be repaid within a short period (a year or less) are referred to as,
A) Current Liabilities
B) Fixed liabilities
C) Contingent liabilities
D) All the above
Answer: A
16. Gross profit is
A) Cost of goods sold + Opening stock
B) Excess of sales over cost of goods sold
C) Sales fewer Purchases
D) Net profit fewer expenses of the period
4
Answer: B
17. Net profit is computed in the
A) Profit and loss account
B) Balance sheet
C) Trial balance
D) Trading account
Answer: A
18. In order to find out the value of the closing stock during the end of the financial year we,
A) do this by stocktaking
B) deduct the cost of goods sold from sales
C) deduct opening stock from the cost of goods sold
D) look in the stock account
Answer: A
19. Which of these best explains fixed assets?
A) Are bought to be used in the business
B) Are expensive items bought for the business
C) Are items which will not wear out quickly
D) Are of long life and are not purchased specifically for resale
Answer: D
20. The charges of placing commodities into a saleable condition should be charged to
A) Trading account
B) P & L a/c
C) Balance Sheet
D) None of the above
Answer: A
21. Suppliers personal a/c are seen in the
A) Sales Ledger
B) Nominal ledger
C) Purchases Ledger
D) General Ledger
Answer: C
22. If you want to ensure that your money will be secured if cheques sent are wasted in the post,
you should
5
A) Always pay by cash
B) Cross your Cheques ‘Account Payee only, Not Negotiable.’
C) Always get the money in person
D) Not use the postal service in future
Answer: B
23. Discounts received are
A) Deducted by us when we pay our accounts
B) Deducted when we receive cash
C) Given by us when we sell goods on credit
D) None of these
Answer: A
24. Sales invoices are first entered in
A) The Cash Book
B) The Purchases Journal
C) The Sales Journal
D) The Sales Account
Answer: C
25. Entered in the Purchases Journal are
A) Discounts received
B) Purchases invoices
C) Payments to suppliers
D) Trade discounts
Answer: B
26. At the balance sheet date, the balance on the Accumulated Provision for Depreciation Account
is
A) Transferred to Depreciation Account
B) Transferred to the Asset Account
C) Transferred to Profit and Loss Account
D) Simply deducted from the asset in the Balance Sheet
Answer: D
27. If we take goods for own use we should
A) Debit Drawings Account, Credit Purchases Account
B) Debit Drawings Account: Credit Stock Account
6
C) Debit Sales Account: Credit Stock Account
D) Debit Purchases Account: Credit Drawings Account
Answer: A
28. When a petty cash book is kept there will be
A) No entries made at all in the general ledger for items paid by petty cash
B) The same number of entries in the general ledger
C) Fewer entries made in the general ledger
D) More entries made in the general ledger
Answer: C
29. If a trial balance totals do not agree, the difference must be entered in
A) The Profit and Loss Account
B) A Nominal Account
C) The Capital Account
D) A Suspense Account
Answer: D
30. If it is required to maintain fixed capitals then the partners’ shares of profits must be
A) Credited to capital accounts
B) Debited to capital accounts
C) Debited to partners’ current accounts
D) Credited to partners’ current accounts
Answer: D
31. What do you mean by the supply of goods?
a) Stock available for sale
b) Total stock in the warehouse
c) The actual production of the good
d) Quantity of the good offered for sale at a particular price per unit of time
Answer- d
32. What do you mean by under conditions of perfect competition in the product market?
a) MRP=VMP
b) MRP>VMP
c) VMP>MRP
d) None of the above
Answer- a
33. The relation that the law of demand defines is.
7
a) Income and price of a commodity
b) Price and quantity of a commodity
c) Income and quantity demanded
d) Quantity demanded and quantity supplied
Answer- b
34. What do you mean by a mixed economy?
a) Modern and traditional industries
b) Public and private sectors
c) Foreign and domestic investments
d) Commercial and subsistence farming
Answer- b
35. What do you mean by demand of a commodity?
a) A desire for the commodity
b) Need for the commodity
c) Quantity demanded of that commodity
d) Quantity of the commodity demanded at a certain price during any particular period of time
Answer- d
36. What do you mean by Gross National Product?
a) The total value of goods and services produced in the country
b) The total value of all transactions in the country
c) Depreciation in the total value of goods and services produced in the country
d) The total value of goods and services produced in the country and net factor income from abroad
Answer- d
37. The reason for the decline in the child sex ratio in India is.
a) Low fertility rate.
b) Female foeticide
c) Incentives for boy child from government
d) None of the above
Answer- b
38. What things are taken into consideration while revising the poverty line periodically?
a) By conducting a survey every five years
b) National Sample Survey Organisation carry out the survey
c) Both a and b are taken into consideration
d) None of the above
Answer- c
39. In India, which bank has the highest share in the disbursement of credit to agriculture and allied
activities?
a) Cooperative Banks
b) Regional Rural Banks
8
c) Commercial Banks
d) Microfinance institutions
Answer- c
40. Which of the below-mentioned institutes are linked with the financial sector of India controlled
by the Reserve Bank of India (RBI)?
a) Commercial Bank
b) Money Lenders
c) Stock Exchange Operations
d) All the above
Answer- c
41. What does Price flooring mean?
a) Shortage
b) Surpluses
c) Equilibrium
d) None of the above
Answer- b
42. What is the Gross National Product?
a) The total value of Good and services manufactured in the country
b) The total value of all the transactions in the country
c) Reduction in the total value of goods and services produced in the country
d) The total worth of goods and services generated in the country and net factor income from
abroad.
Answer- d
43. Why statistically is the unemployment rate low in India?
Unemployment is calculated only from the age group 15 years to 59 years
Unemployment survives only when an individual cannot find a job
People are not interested in working outside the domestic area
Choose the correct option.
a) Only 3
b) 2 and 3
c) Only 2
d) All of the above
Answer- c
44. The bowed shape of the production possibilities curve illustrates.
a) Law of Increasing Marginal Cost
b) The production is inefficient
c) The production is unattainable
d) The demand is relatively elastic
Answer- a
45. The main economic problem faced by all society is.
9
a) Unemployment
b) Inequality
c) Poverty
d) Scarcity
Answer- d
46. “Capitalism” refers to?
a) The use of market
b) Government ownership of capital
c) Private ownership of capital goods
d) Private ownership of homes & cars
Answer- c
47. The goal of a pure market economy is to meet the desire of?
a) Consumers
b) Companies
c) Workers
d) The government
Answer- a
48. The law of demand means?
a) As the quantity demanded rises, the price rises
b) As the price rises, the quantity demanded rises
c) As the price rises, the quantity demanded falls
d) As supply rises, the demand rises
Answer- c
49. The example of agriculture price support program is?
a) A price ceiling
b) A price floor
c) Equilibrium pricing
d) None of the above
Answer- b
50. Who suggested product, pricing, place, promotion all these in a company represents
“Market Mix”?
(A) Neil Borden
(B) Neilsen
(C) Philip Kotler
(D) Stephen Morse
Answer: A